Taiz, Yemen's third largest city, is being pitched as a model for a new federalist government but faces many problems.

Authority is undermined by self-made "sheikh" al-Mikhlafi, who acts as an informal police chief [Al Jazeera]

Taiz - Yemen's third largest city and cultural capital, was at the heart of the youth-led uprising that saw Ali Abdullah Saleh, president for more than three decades, removed from power in 2011.

Out of the glare of the media spotlight for most of Yemen's Arab Spring, the city provided much of the intellectual impetus for the uprising. Activists there paid a heavy price for their role in the revolt. They suffered some of the worst violence directed at protesters, and fighting between pro- and anti-Saleh forces continued even after a peace deal was signed in Riyadh in November 2011.

Three years on, the city is again setting the tone for the rest of the country. As Yemen moves shakily through its internationally backed political transition, President Abd Rabbu Mansour Hadi, Saleh's successor, has singled out Taiz and neighbouring Ibb as showpieces for the federal system of government he believes will allow Yemen to end decades of centralised autocratic rule under his predecessor towards a more equal split of power and wealth.

The two governorates will be merged into a single self-governing region, Al Janad, under the new system.

Hadi hopes that Taiz, under its governor of two years, Shawki Hayel Saeed, will act as a model for the kind of apolitical, technocratic approach to government he wants to see prevail under federalism.

But Taiz is equally symbolic of the issues Hadi, and Yemen, face in trying to move beyond the legacy of the Saleh era and the deep political polarisation entrenched since Saleh's ouster.

Saeed has seen initiatives and appointments obstructed by Yemen's two main political rivals, the General People's Congress (GPC), the historical ruling party of which Saleh remains president; and Islah, a coalition of Islamists, tribal leaders and conservatives. His authority has also been undermined by the continued presence of Hamoud Saeed al-Mikhlafi, a self-made "sheikh" who led Islah-affiliated, anti-Saleh militias in 2011 and has since carved out a role for himself as an informal police chief and alternative to Taiz's slow-moving local courts system.

Although Taizis have long seen themselves as non-tribal and being above the personalised power struggles of Sanaa, the city's current problems are not much different from tensions elsewhere in Yemen. A local political observer said that the city is now stuck between "state and sheikh".

Saeed had not expected to return to the job after leaving for a trip to Saudi Arabia in the middle of March. "My last try was 12 days ago," he said in early April, of his third attempt at resigning from the role he was appointed to two years ago. Hadi, he said, had refused his resignation.

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The source of Saeed's frustration was clear. He returned to Taiz to discover that local political groups affiliated with the Joint Meeting Parties, a coalition of political parties led by Islah, had refused to accept his pick for the head of the health department in Taiz.

According to Saeed, government officials in Taiz and other local observers, this was not an isolated incident. A similar set of issues had arisen over the appointment of an education head the year before.

Political parties have been working against the governor since his appointment, with local politicians questioning his policies and blocking his appointments. Ministers and government officials in Sanaa, who oversee a highly centralised bureaucracy, have also reportedly made life difficult by withholding funding for projects and trying to make their own politically-motivated appointments in Taiz.

"What has become important for the GPC and Islah is the control of government," said Bushra al-Maqtari, a prominent figure in the Taiz protest movement and a keen observer of Yemeni politics. "But they didn't take into account the development of [Taiz] or the country… If both sides stopped interfering in each decision then Shawki could do his work."

Local politicians deny that they are obstructing Saeed. Rather, they say, the governor over-promised - "He said he would turn Taiz into Dubai," one of Saeed's stauncher critics said - and under-delivered.

A leading member of the local chapter of the Islah party calls Saeed a "good man" but cannot resist going on to list his perceived failings. "One of the simple issues is the cleanliness of the city. It doesn't need much effort," he says, echoing a complaint made by a number of Taizis.

Others complain that his attempts to run local government "like a CEO" simply will not work in a country where personalised rule based on individual relationships is the norm. "Shawki is good, he wants to work for Taiz but al-Mikhlafi is from the people," says a local political observer of the differences between Saeed and al-Mikhlafi, Taiz's 'sheikh' and the most obvious counterpoint to Saeed's way of doing business.

While the governor conducts his business in an office carefully guarded by a secretary in a bustling government building, al-Mikhlafi meets guests at his home in the manner befitting of the status of a sheikh. Wearing a slender white robe, he perches in the corner of a cushioned mafraj sitting room surrounded by tribesmen and local politicians.

Al-Mikhlafi rose to prominence in 2011, when he formed a militia of men from his home village and other anti-government groups, and drove forces loyal to Saleh out of central Taiz. During the revolution, al-Mikhlafi said, he helped to provide security - "and I still do". He has remained influential since Saleh's ouster, acting as an arbitrator in disputes that locals cannot afford to take to court or where they feel that judges would be too easily bribed to act against their interests. "I spend most of my time solving the problems of the people who come to me," al-Mikhlafi said. "I am like a volunteer."

Both Saeed and Abdulhakeem al-Ashwal, the deputy director of security in Taiz, attested to the role al-Mikhlafi plays as an arbitrator - "I tell him, arbitrate disputes, you can do it better than judges," Saeed said - but were at pains to make the point that they now have control over security in the city.

A number of Mikhlafi-affiliated militias left Taiz in late 2013 after a dispute between al-Mikhlafi's family and tribesmen from another part of the country spilled out onto the streets of the city.

Saeed and President Hadi intervened to bring the violence to an end. Since then, Taiz has witnessed rapid improvements in security, Saeed and al-Ashwal said. The military is slowly being withdrawn from the city, and being replaced by a civilian police force - a rarity in Yemen, where the legacy of the Saleh regime, a military cabal, and the threat of the local al-Qaeda franchise mean that soldiers are a more common sight than policemen in most major cities.

Saeed is confident that recent improvements in security and a balanced budget means that he can now focus on service provision including trash collection and water delivery - another concern for many Taizis.

Yet the question remains whether or not the governor can oversee the kind of improvements Hadi hopes for, and whether a man born to be CEO can coexist with a sheikh who practises informal justice - or, most importantly, whether the new system of federalism can marry these two worlds.

As long as the GPC and Islah are allowed to hold sway over Yemen, al-Maqtari says, little will improve. Federalism will do little to help either.

"Frankly, we didn't need federalism before 2011; we needed a strong state that enforced rule of law," she said. Without that state, she said - and as long as Taiz remains stuck between state and sheikh - Taizis, and Yemenis, will remain in limbo.

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